expansion-overseas
Assured FD Services No Comments

Why Businesses Are Still Considering Exporting

 

Following on from our previous article “Thinking Of Expanding Your Business?“, as more and more businesses are focussing on strengthening their future growth strategies, one very apparent but often overlooked scheme is exporting goods and services overseas. Most are put off by their perception of the complexity and scale of such a project, however with the right direction and determination, huge opportunities exist.

In the following article, Ben Lobel details the emergence of business expansion overseas back in 2015.

By 2025, 880,000 (17 per cent) British small businesses plan to expand overseas – an increase from the 10.8 per cent of small businesses currently taking advantage of additional export revenues.

In 2015 Annual Business Survey figures show that a third of medium-sized businesses and 41 per cent of large businesses currently take advantage of export growth. Small businesses should work with industry bodies like the UKTI to see what opportunities exist and get advice on how to grow their business overseas. Click here to read more.

So how do we feel now as we approach 2017? As we discussed in our previous article “Business Confidence and Strategy Following The Brexit Vote” even with an uncertain European relationship, it seems exporting goods and services still remains an option considered for business growth. Praseeda Nair offers her thoughts on why this might be and the benefits of looking overseas.

A little international expansion goes a long way for a growing business. For starters, it provides a great deal of flexibility about how you present your organisation. Fourth Day, for example, has five offices across four different countries, which makes us sound quite large. Every office, however, contains fewer than ten people, which makes us seem quite small. It’s the best of both worlds – an international team that is nonetheless sufficiently close knit that everyone knows everyone else.

Secondly, as a service-based company, we’ve found that more than one office is a big help in terms of balancing our income and workload. This is particularly true of our Manchester and London offices, where spare capacity in one place can easily be used by the other. Internationally, we have had the opportunity to secure business across borders and to make referrals between offices. In our case, we have found that our European offering can be attractive for US companies venturing into Europe.We’ve expanded slowly but steadily over the past 14 years and have learned a few things that might be helpful if you’re considering taking the plunge into a new territory. Click here to read more…

The growing popularity and success stories show that exporting can be a hugely lucrative opportunity, if implemented correctly.

If you are a UK business contemplating overseas expansion, a Part Time FD can provide the direction and financial guidance you need to ensure maximum success. Contact Assured FD Services today to see how we can help.

Image Credit

expansion
Assured FD Services No Comments

Thinking Of Expanding Your Business?

Once a business is established and making a profit on the products and services sold, it is only natural for a business owner to begin thinking how to manage and bolster growth. It can be an exciting but challenging time – protecting what you already and building upon that with minimal disruption to it is the key to successful expansion. It is also important to remember that there will be areas of opportunity to reduce costs and increase margins as a business develops, so capitalising on these will be key to maximising your success.

It is important to understand the types of business growth and the methods you may wish adopt to achieve it. It is in the interest of the government is encourage and provide support for business growth, as it benefits the economy overall, therefore they themselves have offered an overview and guidance on the topic. The following article can be found on the government website.

Growing your business

Once your business is established and you’re making a profit on the products and services you sell to customers, you may want to start thinking about how to grow.

Many businesses think of growth in terms of increased sales, but it’s also important to focus on how to maintain or improve your profitability.Things you can do to help grow your business include:

  • looking into ways of increasing your sales, both to existing customers and new customers
  • improving your products and services by researching and testing changes with your customers
  • developing new products and services, and selling them to new or existing markets
  • taking on staff or training your current staff, including working with apprentices and mentors
  • looking for additional sources of funding, such as bringing in new investors
  • thinking about selling your products or services online
  • work with a business mentor, who can help you think about how to do all of these things

You can find more information here.

In the following article, Sarah Willingham, owner of MizMoz, Craft Gin Club and MySupermarket, offers her insight from her personal experiences of business growth, and how to best approach the challenges of expansion.

Ready or not: what to do about expansion

Achieving success is front of mind for entrepreneurs when embarking on a new business venture. The initial stages can often be expensive and time-consuming, and business owners naturally want to see that the investment they are making will have a quick return.

Often, it is the idea of expansion that business owners find particularly challenging to navigate. To help with this process, I’ve developed a series of tips to help entrepreneurs recognise when the time is right to move into the next phase of their journey and overcome the barriers to growth to reach their full potential.

Expansion means different things to different businesses. For some it would be adding another shop to a chain, for others it might be starting to operate online. Whatever the goal, it often doesn’t come cheap, and therefore getting help from investors could be key to your success. To get new investors on board, you need to articulate three things: who the business is aimed at, why consumers would buy from it, and why you, as the business owner, are the person to make it work.

Often, it is the idea of expansion that business owners find particularly challenging to navigate. To help with this process, I’ve developed a series of tips to help entrepreneurs recognise when the time is right to move into the next phase of their journey and overcome the barriers to growth to reach their full potential.

To read the full article click here.

Sarah has offered some helpful information relating to her own personal journey of business expansion. Experience in priceless is these situations, so you should surround yourself with the right people and the right advice. You could even consider the services of an interim FD to guide you through the process.

If you are a UK business looking to grow, but are a little unsure about funding options, the government offers grants and loans to those who meet a certain criteria. You can click here to find out what funding schemes you may be eligible for, but I would also suggest contacting your local expert.

I would like to finish out with a summary made by Sarah Willingham.

Ultimately, in every aspect of success – from setting up, to growth, to ongoing innovation – the most important advice I can give is to listen to your customer. Find out what works best for them, and how you can meet their needs. There is no substitute for loyal, engaged customers who feel valued. Then prove your commitment by adapting your business. Only by getting the basics right first, and always keeping customers front and centre, can businesses achieve lasting growth and take that next step…

crowd-funding
Assured FD Services No Comments

The Fastest Growing Method Of Raising Finance For Your Business Or Startup.

If you haven’t looked into crowdfunding and you need capital for your business or startup, then maybe this blog post is for you.

The way crowd funding works is when a large number of people invest a small amount of money each. This is beneficial to both parties as you don’t need to convince one person to invest a large lump sum and the investors often spread their investments across a few projects which significantly reduces their risk.

Another perk to crowdfunding is that anyone can invest in it as the minimal amounts are flexible. This allows people who wouldn’t usually be able to afford a business investment get a piece of the pie.

 

How crowd funding works

 

Some of the pros and cons

Obviously, one big pro is that entrepreneurs acquire funding for their ideas which allows them to bring them to life.

Secondly, investors can help with the creation of the final product as they are often the first people to receive a prototype and provide feedback. Because they are invested they provide useful feedback then can really help improvement the product. Like a mastermind. This increase the chance of success for both the entrepreneur and the investor.

If this sounds like a good idea to you then you would also be interested to hear that at the end of the day you would retain the full decision-making power when it came to the business. If investors didn’t agree with anything you were doing, because they only invested a small amount it’s easier for them to exit than if they had invested a larger sum.

Another positive is that it is a very fast way to raise finance when compared to more traditional means, and also you would benefit from no fees.

It can also be good for promotion as unique and clever ideas spread fast on these platforms. Millionaires have been made on platforms like Kickstarter and Indiegogo before the product has ever been produced.

A negative from the entrepreneur’s point of view is you risk the chance of having your product or amazing idea ripped off and duplicated before it’s even been produced.

A bad thing from an investment standpoint is that these are usually riskier projects so a loss must be expected, however as mentioned earlier if they spread their investment through several projects they can greatly reduce risk.

Crowdfunding Models: Broken Down

  1. Donations – These projects are often artistic or cultural rather than business and the investors doesn’t really get anything tangible back. Just the feeling of doing a good deed.
  2. Giving a reward for a donation – Investors in these projects are rewarded for their donation with things like recognition, prizes, raffles or if a physical product is being sold often first editions and prototypes of the product. Under this model generally no money is returned to the investors.
  3. Lending-based crowdfunding – This is where investors agree to lend their money to a business. The business can benefit from getting a smaller interest rate than if they got a loan from the bank as well as the investor benefitting by profiting at the agreed rate.
  4. Equity-based Investments – This is where a business sells off a share to the investors. Typically, in crowdfunding circles it’s common for shares to be offered from around £100 and upwards.

If you require any assistance or guidance with negotiating any of these arrangements an interim CFO is an incredible resource to have.

Is this common?

More and more people are getting involved with crowdfunding every year. In 2015 in the UK alone over 3.2 Billion was raised in crowdfunded loans, investments and donations.

 

Crowding Funding Graph

 

Where to start?

Luke Davis offers some insight into crowdfunding business networking.

 

For this sizeable collection of entrepreneurs who are not fortunate enough to access an affluent group of friends or relatives, a proactive approach is paramount. Business owners or those hoping to start a company should embrace as many networking opportunities as they possibly can to stir up greater awareness of their product and growth intentions. When the time comes to seek initial investment, you will then have established solid connections with like-minded business owners or investors who could be your first point of contact to raise that crucial 30%.

To read more click here.

 

Alternatively, there are platforms out there to promote your crowdfunding project and have their community invest. A number of UK services are provided below.

  1. Crowdcube – Is one of the few crowdfunding companies that solely helps British businesses so this takes our number one spot.
  2. Crowdfunder – Another UK based company – This platform is especially great for community projects but also has some business opportunities.
  3. Ratesetter – Voted the UK’s leading peer to peer lending based service. They boast lending out over £1 billion without any of its customers losing a penny.

There are also dozens and dozens of international platforms available such as Kickstarter, Indiegogo and GoFundMe, but for the purpose of our audience, I’ve tried to keep it to UK.

If you are looking to raise capital for your business or startup there is a huge amount of options available to you, including the SEIS programme we blogged about earlier this year. We, at Assured FD Services, are experts in business finance providing first class business financial management as part time FD across Leeds & Yorkshire and the North of England. Contact us today, to discover how we can help you launch your business idea or accelerate the growth of your current business.

assured interim finance manager start up funding
Phil Hall No Comments

Need money to fund your start-up? Try the SEIS with Assured FD.

Have you had that fabulous idea that cannot fail, but can’t get funding from your Bank without giving a personal guarantee?

Then the SEIS, or Seed Enterprise Investment Scheme to give it its full name, could be the perfect solution for you.

The problem you face when starting off in business on your own is to get investors willing to back you.

By definition you don’t have trading history to back-up your confidence and you won’t have / or don’t want to offer personal assets to guarantee the debt.

On the other hand an investor knows that funding a startup is high-risk. Most start-ups fail after all.

The SEIS, a little known scheme set up by the former chancellor attempts to solve these problems by giving the investors large tax reliefs from the outset and also providing further tax reliefs as compensation should the business fail.

Who can use this scheme? Just about any start-up or company that has been trading for less than 2 years with few exceptions.

Who can invest? Just about anyone as long as you’re not an existing employee or own 30% or more of the company i.e. You (That rules out your spouse, mum, dad and children too by the way) But friends can invest- up to £100,000 if they have the cash and the tax bill. So can wider family – brothers and sisters.

What do Investors gain? 50% of their investment can be offset against their tax bill straight away even though they have to hold the shares for 3 years. So that £100,000 investment allows the investor to reduce his tax bill by £50,000.

Should he sell his shares after the 3 years have expired, there is no capital gains tax. Should the business be profitable our investor will also be eligible for dividends.

And what if the business fails? The Investor can claim a further relief of his marginal tax rate multiplied by the amount of his investment less the tax he has already recovered. To explain that – our investor above has invested £100,000 and claimed back his £50,000 relief. Should the business fail he, as a higher rate tax payer, can reclaim 40% of £50,000 (£100,000 – £50,000) or £20,000.

If there is a better way to fund your startup, Assured FD Services is unaware of it.

Interested? Contact Assured FD using our contact form or email info@assuredfd.co.uk

Assured FD Services

Cashflow forecasting
Phil Hall No Comments

Cash Flow Forecasting – or how to survive the recession.

The oil price has been plummeting – have you noticed? A barrel has lost about 15% of its value in the last few weeks and there’s more to come we feel. The one positive about the plight of Greece and the Euro is that we will shortly all see lower prices at the pumps.

All of which reminds me of my first FD job in the 1990s. I had become Finance Director of an Oil Company, just as Iraq invaded Kuwait. Then as now the price of oil was affected by events not related at all to supply and demand and had started to rise sharply – anticipating a war. I realised very quickly that this would have a major impact on our cash flow and eventually our Bank facility. We were a highly leveraged MBO and cash was tight.

I spent my first few months preparing – then revising – daily cash flows, several at a time allowing for ever higher oil prices. In the event Bush declared war and the oil price dropped like a stone!

So a waste of time? Not at all. Like every well-run company we were well prepared. The benefits were clear

1. We gave ourselves time to devise an action plan to preserve cash.
2. We informed our Bank in good time thereby avoiding last minute shocks for them – and as we know BANKS HATE SURPRISES.
3. We came across as thoroughly professional – something that would have been hugely beneficial if we had got into difficulty.

All of which brings me back to the current day and recession. With sales dropping but bills still to pay. Maybe stock levels at pre-recession levels. Customers taking longer to pay, Suppliers tightening terms and Banks unwilling to increase support. Never has it been more important to predict cash levels by forecasting.

I always begin a new assignment as part-time Finance Director with a forecast. If you feel you too could benefit from a more professional approach to your finances – call me now. Don’t wait until its too late!

Stamp printed on the approved loan application approved.
Phil Hall No Comments

Neither a Borrower nor a Lender be…

Well the Banks are keeping to their side of the bargain if you believe what you read in the press. My experience in 2011 though couldn’t have been more different. I found the Banks generally keen to support the businesses I represent. The issue I found was not “if” but “how” and it is with this in mind that I want to put the case for Confidential Invoice Discounting.

The attitude of the Banks has definitely changed post credit crunch. The preference now, it seems to me, is for C.I.D financing over overdrafts, being for them a very capital effective method of lending. My problem is that I have yet to work for an MD that likes to admit using Invoice Discounting – probably because it is too closely associated with factoring – “the lender of last resort”

My experience is that Banks understand this and take the “confidential” part of the name seriously – even when they contact your customers as they can be required to do at the outset and during audits.

But first the “Cons”. My view is that it is not a suitable method of financing an acquisition for example and it can appear expensive – a low rate of interest but a service charge that needs to be paid even when you’re not utilising the facility.

But at a time when the value of other forms of security, like property, have fallen, being able to use your sales ledger to access funds quickly means that this method of financing will increase in popularity. And of course the amount you can access grows as your business grows. Best of all – no personal guarantees – though do watch out for indemnity clauses.
If you need to talk to someone about financing and invoice discounting in particular – contact me.